Could today’s India outshine yesterday’s China?
By Kristen McGachey, 17 Aug 17
Though it might be tempting to view today’s India as yesterday’s China, Rathbones’ head of asset allocation Ed Smith thinks the region’s growth prospects could be even greater based on five key indicators.
Exactly 70 years after winning its independence from British imperial rule, India has become one of the most attractive and dynamic emerging market economies, enticing investors from all over the globe.
A large part of the recent appeal comes from the host of tax and regulatory reforms carried out by Indian prime minister Narendra Modi that have made investing in the region simpler and cut through some of the bureaucratic interference.
Modi’s Good & Services Tax, adopted on 1 July, is “an important reform milestone,” said Rathbone’s Smith, which “nullified the previously unnavigable jungle of local taxation”.
“Now that prime minister Narendra Modi’s government looks more poised to break free from his country’s administrative lassitude, India may be about to play catch-up,” he said.
While India today may look similar to China at the turn of the millennium, Smith thinks there are five key differences that could see the current EM golden child untap even more growth potential than its imposing neighbour to the north.
